A person's will outlines who will inherit their property upon their death and who will…
The Importance of Estate Planning in Light of the COVID-19 Pandemic
The COVID-19 Pandemic has forced many of us to confront a scenario in which we are wondering what would happen if we suddenly became critically ill or, in some instances, unexpectedly and suddenly passed away. These scenarios may trigger a person to ask the question: “Did I properly implement an estate plan, and if I have already implemented an estate plan, was it recently reviewed to make sure it meets all of my estate planning goals?” As a result of the global health crisis, it is critical for you to be prepared in order to protect yourself and your family.
Unfortunately, COVID-19 has caused many people to become very ill, including situations where the individual is unable to communicate his or her own health care and financial decisions. A crucial component of all estate plans is that an individual has his or her advance directives in place. Advance directives are documents that are executed in advance of a crisis and that allow a person to designate an individual or individuals to make health care and financial decision on their behalf, in the event it is needed.
All adult individuals should have the following documents in case they are unable to manage their affairs:
- A Durable Power of Attorney for financial decision making and asset management.
- A Health Care Proxy for health care decisions in a hospital.
- An Authorization for Release of Protected Medical Information (HIPAA) so people you trust can access your medical records for you.
- A Living Will giving instructions regarding end of life medical decisions.
Last Will and Testament
Amidst this Pandemic, we also have unfortunately witnessed a significant number of tragic deaths. As part implementing a comprehensive Estate Plan, an individual should have a Last Will and Testament, and in some cases, a Last Will and Testament and a Living Trust.
A Last Will and Testament is a legal document that allows you to control who will inherit your assets upon your death and to appoint someone who you trust to serve as your Executor. Your Executor will administer and distribute your probate estate in accordance with your wishes as stated in your Last Will and Testament. By executing a valid Will, you can control (i) who inherits in your assets, by documenting your wishes, (ii) who manages your estate, by designating someone you trust as your Executor; and (iii) you can make sure to provide for loved ones in a protective way.
After your passing, your Executor will be required to probate your Last Will and Testament if you have a probate estate. Probate is the legal process of submitting the Last Will and Testament to the Surrogate’s Court for approval. The Last Will and Testament will only govern assets that were solely owned in the decedent’s name at the time of death and which have no designated beneficiaries. Assets that the decedent owned at death that has a right of survivorship, beneficiary designation, or are held in trust, will pass by operation of law outside of the Last Will and Testament.
Revocable Living Trust
Many individuals choose to establish a Living Trust when one of their estate planning goals is to avoid probate. One of the most important benefits of avoiding probate is that your assets will pass upon your death to your beneficiaries without the delay and costs involved with a probate proceeding in the Surrogate’s Court. This is important because it allows a decedent’s beneficiaries to gain immediate access to assets for the payment of the decedent’s funeral and other expenses. Similar to a Last Will and Testament, a Living Trust will allow you to control who inherits your assets by documenting your wishes, who manages your estate by designating someone as your Trustee and assurances that you can make sure to provide for loved ones in a protective way. You should also have a Pour-Over Will in case you do not fully fund the Revocable Living Trust (as a safety net) which pours to the Trust any assets outside of the Trust which does not have a beneficiary designation.
The COVID-19 Pandemic is a solemn reminder to all of us that life is unpredictable and that we must be prepared. By implementing a comprehensive estate plan, you will have peace of mind knowing that you have put a plan in place to ensure that you and your loved ones are provided for in the ways that you desire.
It is important when implementing estate planning to consult with and retain experienced attorneys. Russo Law Group, P.C., has experienced, knowledgeable and compassionate attorneys who can provide professional services and advise you. Please contact us if you would like us to assist you.